Levin calls for corporate tax loophole closures

By MARK RANZENBERGER/@ranzenberger

Thursday, April 4, 2013

Sen. Carl Levin told a group of Central Michigan University students Thursday that he wants to spend his last two years in office closing corporate tax loopholes and bringing the federal budget into balance with more revenues and less spending.

“Tax loopholes are used by large corporations to avoid paying any taxes in America,” Levin told students in a CMU journalism class. “They pay a lot less in taxes than they ever have.”

Levin said that although the nominal corporate top tax rate is 35 percent, very few companies pay that amount in taxes. He said the typical rate after deductions and credits is more like 12 percent.

“Thirty of our most profitable corporations, over the past two years, with $120 billion in profits, paid zero,” Levin said. He said that over the past several decades, the share of the cost of government paid by corporations has fallen from 50 percent to 9 percent.

“There are so many ways to avoid paying taxes in this country,” Levin said.

Levin visited Mt. Pleasant during a swing through the state after announcing he would not seek a seventh term in the U.S. Senate. Levin’s announcement set off a scramble, particularly among Republicans, who believe they might have a chance to retake the seat.

But Levin is staying out of the politics. He said if he ran for another term, he’d have to spend a lot of time campaigning and raising money – and that would take away from making an impact on policy.

“I don’t want to face that distraction,” Levin said.

Levin defended the Affordable Care Act, which he supported. The law continues to be controversial, with strong opposition from business interests.

“The Republicans thought that if they labeled it ‘Obamacare’ that they would win the election,” Levin said. President Barack Obama and his supporters eventually appropriated the label themselves.

The health insurance overhaul was designed to increase the number of people with health insurance by requiring more employers to provide it, as well as requiring many people who can’t get it through their employers to get it themselves.

“Obamacare is aimed at making sure that we have universal health care,” Levin said. “We’re the only major economy that doesn’t have universal health care.”

Many countries use a so-called single-payer system. In Canada, for example, people choose their own doctors and hospitals, which send the bills to the province for payment, much as U.S. providers bill private health insurance companies.

“We could have put together a single-payer system,” “Everybody’s required to pay a premium, and then you go to your doctor. Politically, it couldn’t get done, because it’s a tax.”

Levin said the U.S. system was highly inefficient. Where Canada spends about 1 percent of health care dollars on administration, more than 30 percent of U.S. health spending goes to administration.

“We have a very wasteful system,” Levin said. “It’s not a system we ought to be proud of. If we have 40 million uninsured, we should be ashamed of ourselves.”

He said the Affordable Care Act would require electronic medical records and a more efficient billing system.

“The billing system we have now is absolutely crazy,” Levin said.

Mark Ranzenberger is online editor of TheMorningSun.com. Follow him on Facebook at facebook.com/ranzenberger.